You are not a beautiful and unique Snowflake which just picked up another hundred mill
But the cloud data warehouse startup is bracing itself for IPO
Cloud data warehouse startup Snowflake has picked up a $100m D-round of funding.
Total funding, since the company was started up by Oracle veterans in 2012, is now $205m. There was a $45m C-round in 2015, when the product came out of beta testing, and a $26m B-round in 2014 with the remaining $34m made up from an A-round earlier that year and seed funding.
The product was a SQL data warehouse, developing its own database engine, and having the warehouse run on AWS.
The latest funding round was led by ICONIQ Capital and accompanied by Madrona Venture Group plus all the existing funding partners; Altimeter Capital, Redpoint Ventures, Sutter Hill Ventures and Wing Ventures.
Snowflake is run by Bob Muglia, an ex-Microsoft senior exec who looked after servers and tools, liked SQLServer. He joined Snowlake in June 2014.
Muglia's prepared quote about the D-round said: "The additional funding will help us serve organisations of all sizes and across all industries."
More specifically it will be used to expand Snowflake's operations across the US and UK, and establish a presence across the EU and Asia Pacific. Some will be used to grow Snowflake's engineering team, particularly in its newest engineering office in Bellevue, Washington.
In its financial year, which ended on January 31, Snowflake:
- Nearly doubled its customer base
- Grew total customer data storage by over 300 per cent
- Lowered its storage pricing by 80 per cent, claiming this made its pricing the lowest among data warehouse vendors
- Ranked number one in GigaOM Research's report "Sector Roadmap: Cloud Analytic Databases 2017"
- Launched Snowflake On Demand giving data users of any type access to its data warehouse
- Set up partnerships with technology vendors such as Tableau, Looker, MicroStrategy, Informatica and Talend
- Launched the Snowflake Solution Partner Program
The product has enterprise-grade security features including support for HIPAA compliance and federated authentication.
The VCs obviously like this progress, and buy into the notion that cloud-based, big data and business analytics technology is becoming a core need for businesses, and reckon data warehousing with big data-style cloud-native analytics is a red hot area.
Matt Jacobson, general partner at ICONIQ Capital, said: "Everything that makes a company great now centres on data: the speed to assemble and organise data, and the ability to extract value and insight from that data."
And why did his firm invest in Muglia's company? "Snowflake has perfectly positioned itself at the core of the data revolution."
That's a hope rather than a fact, of course, and hindsight will show if it's true or not.
Bob Muglia has blogged about the latest funding and Snowflake's situation. He says OLTP systems emerged 50 years ago and started generating masses of data that could be analysed to make a business more efficient.
Transaction data was stored, extracted and loaded into data warehouses for later analysis. As the amount of data grew so too did the need to analyse it faster. Muglia writes:
Their struggle is bigger today than it has ever been. The exponential increase in available data in the past 10 years has outpaced the improvements in legacy data warehouse solutions for on-premises and cloud environments. It's also the reason why Snowflake emerged.
"Nearly every enterprise has many on-premises and cloud-based data silos they struggle to bring together. How do you integrate all of those varying forms of data and make all of that data available for deep analysis by all your users without degrading performance?"
The data is falling into storage like snowflakes, settling down and getting ever deeper. Muglia says: "For many customers, it's difficult to even find the relevant data. Snowflake is designed to make the struggle for data disappear. Our... architecture and... technology have delivered up to 200 times faster performance for our growing customer base, and at one-tenth the cost of their previous data warehouse solutions."
He writes a good blog does Bob. Try this quote: "Snowflake is solving problems that Oracle, Teradata, Hadoop, and other cloud data warehouses can't even begin to deliver: The performance, concurrency and simplicity needed to analyze all your data, from one location, by all your users."
It sings, doesn't it?
Our take on this funding round, and given Cloudera's IPO, is that Snowflake is IPO-bound as well.
Snowflake acknowledges that Amazon offers Redshift, and Microsoft's Azure platform offers SQL Data Warehouse, and various other startups and legacy players offer a number of different warehousing solutions. But it argues that most of these other solutions were retrofitted rather than built for the cloud. And it believes that NoSQL services can't replace traditional data warehouses.
But also traditional and inflexible data warehouses can't be used by thousands of companies, whereas its cloud-based data warehouse-as-a-service can. And they are increasingly going to need the analytics services that Snowflake reckons to provide.
Oh happy days for the Snowflake folks; winter is coming, so to speak, and in the game of data warehouse thrones it reckons it has the strongest claim. ®